TN jobless benefits could see cuts

Republican lawmakers are pushing legislation to slash dependent
benefits for unemployed Tennesseans as a way to rein in a program that
was expanded in 2009 under the federal American Recovery and
Reinvestment Act.

The bill, which cleared a key House committee
with little resistance on Tuesday, would save the state an estimated
$62.5 million annually, according to the Tennessee Department of Labor.
Those savings are necessary, supporters say, because $141 million in
federal funds given to the state under the stimulus have run out, and
Tennessee employers have had to pick up the bill.

A Democratic
leader in the House called the proposal a bad bill that would hurt the
unemployed in the state. But Republican leadership, including Lt. Gov.
Ron Ramsey, said the state was fixing what amounted to an unfunded
mandate.

Consideration of the bill comes one week after the
Department of Labor's unemployment benefits program was blistered in a
state audit that found fraud and mismanagement that "threatened the
integrity" of the unemployment benefits system.

"This is the very
definition of an unfunded mandate," said state Sen. Jack Johnson,
R-Franklin, adding that the state needed to halt the expanded benefits
in order to preserve the health of the unemployment insurance fund.
"Experts say there's no way our fund could withstand another recession."

Under
current state law, unemployed workers receive $15 per week for each
dependent, with a cap of $50 per week, in addition to their regular
unemployment check. The bill, sponsored in the House by Rep. Jimmy
Matlock, R-Lenoir City, and in the Senate by Ramsey and Johnson, would
end such dependent benefits.

Unemployment checks for individuals
are capped at $275 per week. A family with four or more dependents
receives an additional $50 each week.

The bill cleared the House
Consumer and Human Resources committee Tuesday with a voice vote, though
Democrats such as Rep. Mike Turner, D-Old Hickory, expressed their
opposition. Turner criticized the bill as another effort to hurt
Tennessee workers. Turner has been outspoken about Republican-backed
bills related to workers' compensation.

"Obviously, I'm not supportive of this bill," he said.

State overpaid

Last week's audit report found that the Department of Labor and
Workforce gave $73.4 million in unemployment benefits to ineligible
claimants. The total includes overpayment resulting from fraud over the
past six years and from the department's own errors over the past three
years. Overpayments have "increased significantly" over the past three
years, auditors found.

In addition to the benefit cuts, the new
bill would increase the number of weekly computer audits of those
receiving unemployment benefits from 1,000 per week to 1,500 per week.
Anyone who has received unemployment benefits within the previous three
years may be audited to discern whether they were conducting required
job searches. Johnson said the Department of Labor has seen individuals
whose unemployment benefits are audited under the program return to work
five weeks faster than workers who were not audited.

In addition
to eliminating dependent benefit payouts, the legislation would roll
back the "base period requirement," or the minimum amount of time a
person must have worked in order to qualify for benefits. Under the
changes in the 2009 act, workers could qualify if they worked less than
six months, which was the previous requirement. This legislation would
revert back to the six-month standard.

Additionally, the
legislation would deny benefits to anyone who loses his or her job as
the result of being convicted or arrested for a crime committed in
conjunction with a person's employment. The bill includes a claw-back
provision which would allow for the state to attempt to collect benefits
paid out to an employee charged with a crime related to his or her
termination.

Finally, the bill would implement mandatory training
for Department of Labor hearing officers, who decide whether a laid-off
worker is due unemployment benefits.

The bill is being backed by the local chapter of the National Federation of Independent Businesses.